Donald Trump's 145% Tariffs On China Could Disrupt Tesla's Cybercab, Semi Production: Report

The Donald Trump administration's 145% tariffs on Chinese goods amid the U.S.-China trade war have proven to be difficult for Tesla Inc.'s TSLA production plans for the Cybercab.

What happened: Tesla is facing fresh challenges to its production plans for the Cybercab and Semi due to the lingering impact of 145% tariffs imposed on Chinese goods by the Trump administration, according to a report from Reuters.

Elon Musk's EV giant was ‘ready to absorb' the additional costs to ship the components initially, but increasing tariffs have made this strategy financially unfeasible, forcing the company to suspend the move, according to the report.

Tesla planned to begin mass producing the Semi in Nevada and the Cybercab in Texas by 2026, but it is unclear if the company still wants to go ahead with that timeline. The delay could also impact Tesla's promised delivery of Semi trucks to clients like PepsiCo Inc. PEP.

Why it matters: The report comes as Tesla halts new orders for its U.S.-made Model S and Model X in China. In 2024, China imported over 1,553 Model X units and 311 Model S vehicles.

Tesla has been teasing its ride-hailing Cybercab services in Austin, Texas, though experts have since raised questions about Tesla's Cybercab promise.

Musk's company remains a market leader in the U.S. EV sector, and it recently released a flurry of updates for all of its models, bringing some anticipated features to the cars. Tesla even showcased its Unsupervised FSD capabilities in a post on X.

However, Tesla owners in the U.S. are dealing with increased cases of vandalism on Tesla products, properties, and superchargers as well as rising insurance premiums amid Musk's involvement with the Trump administration.

Price action: Shares of Tesla were trading at $254.11, according to Benzinga Pro data.

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